EUR/USD Weekly Outlook – March 4, 2021

Last Updated on March 5, 2021

EURUSD Forex Outlook

Introduction

The binary options brokers see the USA fiscal stimulus package passed by President Joe Biden about $1.9 trillion as aid out of the inflation affecting monetary policies as investors expect the economy to recover from the covid-19 pandemic.

As Germany’s authority sets to lighten the lockdown from covid19, investors are hopeful for a more robust global rebound of the economy. They await details of the U.K.’s new budget measures, which will lift the Europeans stock in the coming weeks.

EURO and U.S. News

The German Final Services PMI

The survey carried out among 400 purchasing managers about the current state of the economy concerning employment, businesses, inventories, and production will reveal the economic condition of the zone currently.

Suppose the flash data survey from the purchasing managers should indicate a result above 50.0. In that case, it means a buoyant economy and expansion in the industry, while a lower outcome less than 50.0 indicates contraction.

The previous flash result is 45.9 while the forecast is 45.9

U.S. ADP Non-Farm Employment Change:

The recent employment data from the labor market shows that it’s still weak despite improving public health in terms of recovery. The ADP Non-Farm Employment Change outcome on hired workers by the private employers fell, which surprised investors affecting the stock markets likewise the other markets.

The previous data was 195K while the forecast was 203K; the actual data came out as 117K, which is not suitable for the currency.

EURUSD Technical Analysis

EUR vs. USD Long-term Overview: Bullish Swing in resistance Zones

Monthly Chart

EURUSD Monthly Chart - March 3 2021

Resistance levels: 1.25558, 1.21545, 1.18808, 1.21801, 1.21695

Support levels: 1.10292, 1.08288

The EURUSD pair on the monthly time frame has reached a previous resistance level of February 01, 2018, which pushed the back price to the demand zone of February 2017 (1.08288).

Bearish divergence on the stochastic indicator indicates a slump of the EURUSD exchange is spotted on the monthly-TF.

The pair needs to close below the 1.18808 levels for confirmation of a bearish trend. Should this bearish momentum buildup, we shall see more selling momentum in the coming months for a bearish trend.

The only way for the bulls to overturn the bearish momentum is by closing over the resistance zone of 1.25558 to continue bullish trends on the monthly time frame.

Weekly Chart Bullish

EURUSD Weekly Chart - March 3 2021

Weekly Resistance Level: 1.23497, 1.20201, 1.14222

Weekly Support Level: 1.19521, 1.12430

The weekly chart shows that few buyers in the market have seen a bullish divergence in the stochastic indicator indicating weakness in the bullish run; however, a close above the 1.23497 will continue the trend.

The sellers’ psychological point to take over the market is a close below the 1.20201 level with a strong bearish engulfing candle that will expose the 1.14222 zones.

However, if the U.S. dollar should get weak and fails to close below the 1.20201 level, we may see the EUR vs. US Dollar rise above the current resistance level of 1.23497 to continue an uptrend.

Daily Chart Projections: Bearish and ranging

EURUSD Daily Chart - March 3 2021

Daily Resistance Level:   1.21896, 1.23495,

Daily Support Level: 1.20230, 1.19521

On the daily chart, you can see the highs are getting lower, and the lows are getting lower, indicating a downtrend in the time frame. The trading broker needs to observe the price closes lower than the recent low of February 05, 2021, for a bearish swing to continue.

However, the January 22, 2021 high of 1.21896 is the buyers’ psychological zone to push the price higher if we get positive indications from the euro zones that will influence the economy.

Bullish Scenario:

The EURUSD pair on the weekly time frame has been on a bullish run since May 11, 2020. A close above the high of 1.23497 for a new higher high on the weekly chart will establish trend continuation.

Bearish Scenario:

There’s a potential buildup of bearish momentum on the daily-TF. The bears will need good fundamental news in favor of the U.S. dollar to break the low of 1.1921 for the bearish trend to persist.

Conclusion and Weekly Price Objectives

The U.S. dollar index started its week on a strong note which indicates strength in the currency across other pairs as the effect of the stimulus package signed by President Joe Biden is expected to strengthen the U.S. dollar and the economy amid the covid19 pandemic.

The European zones are hopeful of a rebound of the economy as measures are taking to relax the covid-19 lockdown measures and open up the economy.

We need to see the price close above the 1.21896 and 1.23495 levels to continue an uptrend. Should the price closes below the 1.19521 levels, we expect the trend to be bearish looking at the daily chart.

 

James S. Martin
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